Open banking-powered lender Koyo inks Series A round to help people with poor credit histories

Koyo has closed a Series A funding round of $50m in debt and equity led by Force Over Mass with participation from existing investors Forward Partners, Frontline Ventures and Seedcamp.

New investors in Koyo include founder of GoCardless, founder of Nested Matt Robinson and experienced angel investors from the banking and lending sectors. It last raised $4.9m in 2019.

Koyo was built on the idea that access to competitively priced financial products and affordable credit is something people take for granted but many do not have access to. It uses open banking data rather than credit agency scores to underwrite risk for lending to consumers. In other words, it looks at how customers spend their money on a day-to-day basis, rather than what a credit agency says about them.

Koyo services a range of customers using transactional bank data to gain an information advantage relative to incumbents. Many segments of the market, such as thin-file customers (short or no credit history) or near-prime customers, have very few options when it comes to affordable credit.

Koyo has helped thousands of UK-based customers access more affordable credit. It provides customers with competitive rates when they may struggle to find offers elsewhere. MoneySuperMarket, CompareTheMarket, Experian and other large household UK brands now list Koyo on their comparison panels.

Koyo launched its consumer loans business in January 2020 at the start of the pandemic in the UK. The pandemic created a challenging lending environment for the consumer credit industry. However, during this time Koyo had a unique opportunity to widen its target market from those who were historically thin-file, to the larger near-prime UK risk segment.

Koyo’s founder Thomas Olszewski said, “Koyo launched at the start of the global pandemic and has proven that innovative use of open banking data results in better risk decisioning and ultimately has enabled us to grow the business during one of the toughest economic times the UK has faced. I’m proud to have continued to give many people in the UK access to competitively priced credit, during a time where most traditional lenders were quick to scale back their lending.

“UK FinTechs have demonstrated that it’s possible to build global champions right here in London. Our incredibly strong growth over the past 18 months has put us alongside some of the fastest-growing companies in the world I am excited to see what the coming years have in store for us.”


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